Indonesia eyes $4.7 billion in savings to brace for war impacts

Indonesia eyes $4.7 billion in savings to brace for war impacts

JAKARTA
Indonesia eyes $4.7 billion in savings to brace for war impacts

Indonesia is eyeing up to 80 trillion rupiah ($4.7 billion) in savings to cushion its economy from the fallout of the war in the Middle East, according to the government.

Southeast Asia's largest economy is also mulling fuel-saving measures including one day of remote working per week for government and certain public sector workers.

In an interview recorded last week, President Prabowo Subianto was asked about a possible shift in budget priorities for the country that heavily subsidises fuel for its population of just over 284 million.

The former general said the government was "making every effort" to cut costs by curbing energy consumption and boosting production of renewables, mainly solar power.

During the interview, presidential spokesman Prasetyo Hadi suggested the government is seeking savings of 80 trillion rupiah.

Prasetyo did not detail where the money would come from.

The government has repeatedly insisted Prabowo's signature free meals program, budgeted at $19.7 billion for 2026, will remain untouched.

It has also so far staunchly defended its fuel subsidy, which covers about 30 to 40 percent of the cost for consumers and represents around 15 percent of the budget.

These form part of Prabowo's goal to raise the economic growth rate from 5.1 percent last year to 8 percent by 2029, fueled by public spending.

Unlike many of its neighbors, Southeast Asia's biggest economy has not yet seen long fuel queues as global oil prices have soared.

The government will finalise its work-from-home policy and announce it to the public "as soon as possible," Prasetyo said.